Softbank's Son Pitches Benefits of T-Mobile Deal

Without mentioning the target by name, he urges Washington to drop its opposition to a merger with Sprint.

NEW YORK (The Deal) -- In response to a stiff-arm from the U.S. Department of Justice, Masayoshi Son, chairman of Sprint and its Japanese parent SoftBank, on Tuesday stepped up a public relations campaign to sway U.S. policymakers and broadband consumers to accept his wish to merge Sprint with Deutsche Telekom AG's T-Mobile USA Inc.

In a speech held at the U.S. Chamber of Commerce headquarters in Washington, Son told an audience of journalists, telecom lobbyists and public interest group leaders that Softbank/Sprint is prepared to transform its U.S. operations into a new competitor to the broadband duopoly of Comcast (CMCSA) and Verizon Communications (VZ). Son mixed the practical appeal of helping the U.S. move past being a laggard in broadband speed and pricing with his own emotional rags-to-riches life story in reaching out to his audience.

Son didn't mention T-Mobile directly, but the implied purpose of his speech was to generate allies in his fight to convince the DOJ to look at a potential merger with Sprint differently. Rather than look at the merger simply as a combination of mobile phone providers, he wants antitrust regulators to view the deal as one between broadband providers. This distinction is critical because the DOJ has signaled to Son it is very likely to challenge a merger with T-Mobile because it would reduce the number of players in the mobile phone market from 4 to 3.

However, if Son can convince the antitrust regulators to view the affected market as the entire range of broadband players, not just mobile phone providers, the deal might look much less anticompetitive.

Son knows he still has a long way to go before convincing skeptical antitrust regulators and the Federal Communications Commission, which also must approve a T-Mobile deal. Only a few moments after Son's speech, the company announced it has hired Bruce Gottlieb to head the company's new Washington office and continue pressing Son's message. Gottlieb previously was president of the Washington political publication National Journal. He also has served as legal adviser to FCC Commissioner Michael Copps from 2006 to 2008, and on President Barack Obama's transition team. He also has been a staff writer for Slate.